Total to dictate the direction of Kenya's oil to the overseas market


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Tanga pipeline takes shape, as Total mulls Kenyan tie-in

Thursday, Oct 05, 2017

The downstream components of Uganda’s maiden crude oil development took anther step forward in September with the ratification of a deal to route the export pipeline through northern Tanzania.


In common with the upstream project, progress has accelerated in recent months on both the so-called East African Crude Oil Pipeline (EACOP) and the domestic refinery planned at Hoima, near the Albertine fields.
A framework agreement for the refinery is due to be signed this quarter with the investor consortium belatedly selected during the summer.

Meanwhile, reports have begun emerging that super-major Total is considering pushing for Nairobi’s first exports to be delivered to the coast through the EACOP facility rather than internally via Lamu, as previously planned by the incumbent upstream developers. The French firm is the central player in the integrated Ugandan project and now also a stakeholder in Kenya’s oilfields.

The Tanzanian parliament on September 11 ratified the intergovernmental agreement signed with Kampala in May – with ministers reassuring MPs on the stringency of land compensation and local content requirements to be demanded of the pipeline’s foreign backers in order to secure assent. The deal has been cleared by the Ugandan cabinet but it remains to be put before the legislature.

Following the ratifications, the two authorities are due to sign Host Government Agreements with the three IOCs developing both the up- and downstream elements of Uganda’s Lake Albert project – China National Offshore Oil Co. (CNOOC), Total and the UK’s Tullow Oil. Negotiations thus far have covered transit fees and taxation – as well as the compensation and local content rules.

The estimated US$3.55 billion EACOP is currently in the front-end engineering and design (FEED) phase, with studies close to completion by the US’ Gulf Interstate Engineering. The project comprises a 1,445-km, 24-inch (610-mm) heated pipeline capable of carrying 216,000 bpd of waxy Ugandan crude from Hoima to the port of Tanga on the Indian Ocean.

Total is taking the lead on the contracting, and received expressions of interest (EoIs) in mid-June for the engineering, procurement and construction management (EPCM) contract. The bidding process is expected to commence imminently in preparation for the start of construction envisaged next year.

Completion is scheduled for 2020 – although the timetable is regarded as highly optimistic in light of the persistent delays that have beset all elements of Uganda’s development plans since first oil was struck more than a decade ago.

A team of Sumitomo-Mitsui Banking Corp. (SMBC), Imperial Bank of China and the local unit of South Africa’s Standard Bank was selected in August to advise on the debt-financing package – expected to cover around 70% of project costs. The remaining 30% will be raised through equity contributions by the IOCs and the two countries’ NOCs. Recent statements from Total and Tullow anticipate a final investment decision (FID) by year-end.

In 2015, Total persuaded Uganda of the superior merits of the route via Tanzania at the last minute in preference to one terminating at Lamu.

Hoima progress
The estimated US$4 billion project to build a greenfield refinery at Hoima has an equally chequered history. However, an investor consortium comprising US engineering giant GE, Yaatra Ventures, also of the US, and Italy’s Saipem – as the EPC contractor – reached core project terms with Kampala in August to develop the planned 30,000 bpd facility, following a relaunch of the four-year-old bidding process earlier in the year.

A project framework agreement was said at the time to be due within around two months. Details were not provided on the relative shareholdings of the consortium partners, the government and East African Community partners.

Tullow, the lead developer of Kenya’s Turkana oilfields, had lobbied against Total and in favour of sending the Ugandan crude for export via northern Kenya – in light of the possibility of delivering both countries’ first oil through the same pipeline.

Since Kampala’s rejection of the former route, the UK firm has stated plans to install the Lokichar-Lamu stretch of the proposed pipeline for Kenya’s crude alone. However, in the wake of the French firm’s acquisition of Denmark’s Maersk – a stakeholder in the Kenyan fields – early discussions are reportedly being held on a wholesale reversal of the original plans. This would entail the Kenyan crude being delivered to international markets through the Hoima-Tanga pipeline.

Reaffirming a commitment to the Ugandan pipeline when announcing the Danish acquisition, Total’s CEO Patrick Pouyanne hinted at the possibility. “We’ll not change our plans on [the] Uganda [export pipeline], but maybe we’ll see if we can be efficient and participate in the development of Kenya,” he said.

The cost savings – for the companies and especially for cash-strapped Nairobi – would be considerable, with the cost of the Lokichar-Lamu pipeline having been estimated at US$2.5 billion.

However, the latter is a core component of the much-vaunted, Nairobi-led multi-billion dollar Lamu Port-South Sudan-Ethiopia Transport Corridor (LAPSSET) project – which calls for the development of a wide range of infrastructure links along the East African coast – and would further signal the scheme’s failure thus far to deliver on hugely ambitious aims.
Furthermore, both the pipeline and the regional project form part of Nairobi’s plans to spur economic development in the poor and politically unstable north of the country.

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Your Petrochemical News | Tanga pipeline takes shape, as Total mulls Kenyan tie-in
 
LightYagami

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You know, bitching about Kenya all the time wont make your god forsaken country better
 
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we don't do what you think is"best" for us. we do whatever we want
 
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This is the best option for Kenya economically, politically GoK won't be happy especially because it goes through TZ
Pray tell, how is it the best option economically to Kenya?
 
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Pray tell, how is it the best option economically to Kenya?
Economy of scale u will reap maximum profit as running costs will be lower. Imagine building a $2.5 bln pipeline for less than 200 mln barrels of recovable oil n the Al shaababs keep blowing the pipeline each day. Let senses dictate the secure route leave ur ego aside.
 
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Pray tell, how is it the best option economically to Kenya?
Geza has said it all, your oil is about 800 barrels, of this only 30% is recovable, that is about 200barrels @ $50 Per barrel is about $10B, deduct $2B of pipe line you remain with $8B, deduct 60% of all other costs of production, security, land, communities, kickbacks, interests to service loans, what is remaining is less than $2B, hiyo ni biashara ya maua?
 
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Economy of scale u will reap maximum profit as running costs will be lower. Imagine building a $2.5 bln pipeline for less than 200 mln barrels of recovable oil n the Al shaababs keep blowing the pipeline each day. Let senses dictate the secure route leave ur ego aside.
And the oil reserves in Kenya keep reducing by the day, in your head that is. They make new finds but it seems you subtract instead of add to the initial figure.

The heavily weakened and battered Al-Shabaab are your best excuse? Iraq is at war with itself and wit ISIS, so is Syria. The Al-Qaeda a much more potent group are in Egypt with Nigeria having the insane Boko Haram problems. Heck even neighboring South Sudan is at war with separatists and It's Northern Sudan neighbor has the Darfur fundamentalists. Do you know how much oil each of those countries export per annum? Do you know the length of their pipelines and number of refineries (save for South Sudan)?
 
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And the oil reserves in Kenya keep reducing by the day, in your head that is. They make new finds but it seems you subtract instead of add to the initial figure.

The heavily weakened and battered Al-Shabaab are your best excuse? Iraq is at war with itself and wit ISIS, so is Syria. The Al-Qaeda a much more potent group are in Egypt with Nigeria having the insane Boko Haram problems. Heck even neighboring South Sudan is at war with separatists and It's Northern Sudan neighbor has the Darfur fundamentalists. Do you know how much oil each of those countries export per annum? Do you know the length of their pipelines and number of refineries (save for South Sudan)?
Do you know the investment invested to protect those pipeline.
Na bado zinalipuliwa.
 
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Geza has said it all, your oil is about 800 barrels, of this only 30% is recovable, that is about 200barrels @ $50 Per barrel is about $10B, deduct $2B of pipe line you remain with $8B, deduct 60% of all other costs of production, security, land, communities, kickbacks, interests to service loans, what is remaining is less than $2B, hiyo ni biashara ya maua?
There are 750+mn barrels of recoverable oil finds, where did you get that 30% recoverable oil stuff?
New find takes Kenya closer to billion barrels of crude oil

Let's redo your calculations again. This time with patriotism and hatred aside. costs are:-
a)pipeline cost (to SS) - $3bn
b)Oil refinery (120000bpd) - $2.8bn
c) Oil terminal at Lamu- $3bn (u/c)
d)Refinery and pipeline running and maintainance costs($15 per barrel)- $11.25bn
Total costs - $20-$25bn (inflation a/c)

Revenues
Assuming a capacity of 250k for the pipeline as per LAPSSET requirements
a)120000bpd Refined oil (48% 0f total reserves sale)- $36bn
b)Unrefined oil (52% of total reserves sale) - $19.5bn
Total revenue - $55.5bn

And that is just Kenyan Oil. The pipeline is to stretch to South Sudan and Ethiopia, The former having almost 5 times Kenyan + Ugandan proven reserves.
 
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Do you know the investment invested to protect those pipeline.
Na bado zinalipuliwa.
In Nigeria, SS, Syria, Iraq, none. Nigeria is just not interested while the latter 3 are too busy bombing themselves up to think of sending armed personnel to protect pipelines.

Na bado oil is the largest sector, chief export and accounts for atleast 70% of revenues in each, bado zinagenerate billions of revenue annually for the respective governments irrespective of the hostility. Alshabab is a whole lot weaker, almost entirely written off and forgotten
 
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There are 750+mn barrels of recoverable oil finds, where did you get that 30% recoverable oil stuff?
New find takes Kenya closer to billion barrels of crude oil

Let's redo your calculations again. This time with patriotism and hatred aside. costs are:-
a)pipeline cost (to SS) - $3bn
b)Oil refinery (120000bpd) - $2.8bn
c) Oil terminal at Lamu- $3bn (u/c)
d)Refinery and pipeline running and maintainance costs($15 per barrel)- $11.25bn
Total costs - $20-$25bn (inflation a/c)

Revenues
Assuming a capacity of 250k for the pipeline as per LAPSSET requirements
a)120000bpd Refined oil (48% 0f total reserves sale)- $36bn
b)Unrefined oil (52% of total reserves sale) - $19.5bn
Total revenue - $55.5bn

And that is just Kenyan Oil. The pipeline is to stretch to South Sudan and Ethiopia, The former having almost 5 times Kenyan + Ugandan proven reserves.
One question sir, can you just tell me how much oil will be available from that one billion barrels?, remember that it is only 30% of the amount discovered can be extracted, that is the science of oil, you can't fight againts it, read all documents on oil engineering will tell you the same, and this amount which can be extracted is refered as recoverble oil, Uganda with 6B barrels discovered, they do expect to recover only 1.6B, so why do you think Kenya can recover 100% of its oil?.
 
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And the oil reserves in Kenya keep reducing by the day, in your head that is. They make new finds but it seems you subtract instead of add to the initial figure.

The heavily weakened and battered Al-Shabaab are your best excuse? Iraq is at war with itself and wit ISIS, so is Syria. The Al-Qaeda a much more potent group are in Egypt with Nigeria having the insane Boko Haram problems. Heck even neighboring South Sudan is at war with separatists and It's Northern Sudan neighbor has the Darfur fundamentalists. Do you know how much oil each of those countries export per annum? Do you know the length of their pipelines and number of refineries (save for South Sudan)?
So r u Iraq or Nigeria? U r a fool mind u u have a territorial dispute with Somalia on border demarcation it might turn out even Lamu deep sea territory belongs to them! Total oil aren't stupid it is top 5 biggest oil company in the World with over 100 years of experience! BTW Total oil worthiness is bigger than Kenya's GDP itself.
 
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In Nigeria, SS, Syria, Iraq, none. Nigeria is just not interested while the latter 3 are too busy bombing themselves up to think of sending armed personnel to protect pipelines.

Na bado oil is the largest sector, chief export and accounts for atleast 70% of revenues in each, bado zinagenerate billions of revenue annually for the respective governments irrespective of the hostility. Alshabab is a whole lot weaker, almost entirely written off and forgotten
The Boko Haram are in the North n oil fields in Southern cost. U must be so stupid to compare Nigeria n Kenya insecurities knowing in Nigeria came after that huge oil investments.
 
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One question sir, can you just tell me how much oil will be available from that one billion barrels?, remember that it is only 30% of the amount discovered can be extracted, that is the science of oil, you can't fight againts it, read all documents on oil engineering will tell you the same, and this amount which can be extracted is refered as recoverble oil, Uganda with 6B barrels discovered, they do expect to recover only 1.6B, so why do you think Kenya can recover 100% of its oil?.
Achana nae hii field wako nyuma sana kujua chochote!
 
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The Boko Haram are in the North n oil fields in Southern cost. U must be so stupid to compare Nigeria n Kenya insecurities knowing in Nigeria came after that huge oil investments.
There is a group called Niger delta Avengers in nigeria (google it) they are worse than boko haram interms of Financial damage, they blow up billion dollar pipelines on monthly basis. They have been wanting to secede from nigeria for a very long time and and controll all the oil regions in the delta..


Anyway, this was happening juzi

wp_ss_20171027_0001-png.618256
wp_ss_20171027_0002-png.618257
wp_ss_20171027_0003-png.618258
 
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Achana na mburula lishakunywa chang'aa hii field wako nyuma sana kujua chochote!
Tatizo la wakenya wengi, hawataki kujipa muda wa kutosha ili waweze kujifunza vitu kwa undani, badala yake wanachukulia kila jambo kiushabiki zaidi, miradi mingi ya Kenya imeanzishwa kiushabiki zaidi kuliko kibiashara, au kuangalia faida, maamuzi haya yakifanywa na wanasiasa wanasema ni maamuzi ya kisiasa, lakini yakifanywa au kushabikiwa na mwananchi wa kawaida wanasema ni uzalendo, lakini karibu wakenya wengi uwezo wao wa kuchanganua mambo ni mdogo sana
 
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There is a group called Niger delta Avengers in nigeria (google it) they are worse than boko haram interms of Financial damage, they blow up billion dollar pipelines on monthly basis. They have been wanting to secede from nigeria for a very long time and and controll all the oil regions in the delta..


Anyway, this was happening juzi

View attachment 618256 View attachment 618257 View attachment 618258
They r no way compared to Al Shaabab they do bunkering! And exists after oil infrastructure is there! On the othet In Lokichar n Lamu Al Shaabab n Shiftas n Mereli n cattle rustlers r already there before the pipeline is built waiting to cause mahyem. No bank will finance that pipeline!
 
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Tatizo la wakenya wengi, hawataki kujipa muda wa kutosha ili waweze kujifunza vitu kwa undani, badala yake wanachukulia kila jambo kiushabiki zaidi, miradi mingi ya Kenya imeanzishwa kiushabiki zaidi kuliko kibiashara, au kuangalia faida, maamuzi haya yakifanywa na wanasiasa wanasema ni maamuzi ya kisiasa, lakini yakifanywa au kushabikiwa na mwananchi wa kawaida wanasema ni uzalendo, lakini karibu wakenya wengi uwezo wao wa kuchanganua mambo ni mdogo sana
Ni ujinga!
 

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